India

Court ruling raises regulation alarm

INDIA: The Indian wind-power industry has reacted with serious concern to a recent order of the Madras High Court of the state of Tamil Nadu, India's leading wind-power state, that prior permission from the village local government, known as panchayats, is necessary for installing wind turbines.

Previously, project developers had to seek permission from the owner of the land on which a wind turbine was to be installed. Often developers set up wind farms on land they own themselves, and many, such as Suzlon, are building land banks.

"The order has created a huge problem," said DV Giri, chairman of the Indian Wind Turbine Manufacturers Association (IWTMA), warning that the decision will be a big blow to investment in Tamil Nadu. Tamil Nadu has 3GW of wind capacity in the pipeline and the state government plans to install another 10GW in the next five years.

However, the target may prove elusive as Tamil Nadu is fast running out of high wind density areas, even as the state is unable to create grid capacity to transport all the wind-power produced, which is a deterrent to future capacity creation. The latest High Court order, industry members said, will create further problems.

"The court order will raise so many local issues and resentments," Giri said, pointing out that various factors can be behind landowners' opposition, such as lack of information, misinformation, political pressures or greed.

UB Reddy, chief operating officer of Indian independent power producer Mytrah, agreed. "Vested interests will politicise things and eventually it will boil down to money," he said. He added that panchayats have no capacity or expertise to evaluate whether a wind turbine or wind farm will be beneficial for their village.

Giri said the High Court order has come at a bad time as wind-power producers and developers are already worried about a land law proposed by the federal government. The Land Acquisition Bill 2011 seeks to set the minimum price at which land can be purchased while imposing elaborate, far-reaching and long-term conditions on buyers for resettlement of the displaced.

"There are lots of questions about operational modalities and procedural issues that need to be answered," Giri said, adding that the IWTMA will approach the federal Ministry of New and Renewable Energy for intervention.

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